COA says Fabella Hospital paid too much

The Dr. Jose Fabella Memorial Hospital in Manila has been found wanting in the sensible spending of government money.

The Commission on Audit has questioned the hospital’s procurement of liquid oxygen and desktop computers, saying that it did not canvass prices before preparing its budget, resulting in the acquisition of the items at unreasonable prices.

The COA, in its 2010 report on the hospital, also said its bids and awards committee needed to explain why it failed to conduct a public bidding when it bought the oxygen.

It said the approved costs of the liquid oxygen and 22 computers in the hospital budget, which set the ceiling price for participating contractors and suppliers, were “unrealistic.”

Because of this, it said, the hospital ended up awarding the contract to suppliers whose prices were higher by 13.75 percent to 47.29 percent.

In the case of the liquid oxygen, Fabella Hospital bought the gas used for ventilation and respiratory support for sick newborns last year from Acme Corp. for P19.6 per cubic meter, according to the COA. It bought a total of 266,688.93 cubic meters.

Other government hospitals bought liquid oxygen for as low as P13.3 per cubic meter from other suppliers. With the price difference between Fabella’s purchase and that of other hospitals ranging from P2.37 per cubic meter to P6.29 per cubic meter, the additional cost incurred by Fabella for the 2010 purchase ranged from P632,052 million to P1.677 million, it said.

It also said that based on records, there was no public bidding conducted in 2010 for the procurement of the oxygen. The P19.60 price awarded to Acme in 2009 was made the basis for purchasing the items in 2010, it added.

The COA said Fabella’s purchase of 22 non-branded desktop computers in July 2010 were for P65,600 per set, or P1.443 million for the lot. The contract was awarded to Bidmas Computer Sales and Services after a public bidding.

The audit said the approved budget for the contract, at P75,000 per set, was high, since it was 40 percent more than the price offer of another supplier. The COA also said it could not determine the basis of the amount because it was not supported by information and documents. Leila B. Salaverria